The Growing Role of the Euro in Emerging Market Finance
27 Pages Posted: 20 Apr 2016
Date Written: November 1, 2007
Abstract
More than eight years after the introduction of the euro, impacts on developing countries have been relatively modest. Overall, the euro has become much more important in debt issuance than in official foreign exchange reserve holdings. The former has benefited from the creation of a large set of investors for which the euro is the home currency, while demand for euro reserves has been held back by the dominance of the dollar as a vehicle and intervention currency, and the greater liquidity of the market for US treasury securities. Fears of further dollar decline may fuel some shifts out of dollars into euros, however, with the potential for a period of financial instability.
Keywords: Debt Markets, Emerging Markets, Fiscal & Monetary Policy, Currencies and Exchange Rates
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Holding International Reserves in an Era of High Capital Mobility
-
International Reserves: Precautionary Versus Mercantilist Views, Theory and Evidence
By Joshua Aizenman and Jaewoo Lee
-
International Reserves: Precautionary Versus Mercantilist Views, Theory and Evidence
By Joshua Aizenman and Jaewoo Lee
-
Seigniorage and Political Instability
By Alex Cukierman, Sebastian Edwards, ...
-
International Reserves: Precautionary vs. Mercantilist Views, Theory and Evidence
By Joshua Aizenman and Jaewoo Lee
-
The High Demand for International Reserves in the Far East: What's Going on?
-
The High Demand for International Reserves in the Far East: What's Going on?
-
The Optimal Level of International Reserves for Emerging Market Countries: Formulas and Applications
By Olivier Jeanne and Romain G. Rancière
-
The Social Cost of Foreign Exchange Reserves
By Dani Rodrik
-
The Social Cost of Foreign Exchange Reserves
By Dani Rodrik